Yesterday’s major trade news and upcoming US inflation figures are keeping financial markets busy. Here’s what’s moving the currency markets today – and what to watch next.
Tariff Cuts Cement US-China Trade Truce
Following up on earlier reports, the US and China have now formally agreed to slash tariffs on most traded goods.
- The US will reduce duties on Chinese imports to 30%
- China will cut taxes on US goods to 10%
This step back from heightened trade tensions has lifted global market sentiment and added support to the US dollar.
Dollar Dominates, Sterling Holds Firm
The dollar was the clear winner in yesterday’s currency trading, gaining between 1% and 1.5% against both the euro and the yen.
Sterling, meanwhile, maintained a slightly firmer tone, buoyed by broader market calm, despite a relatively neutral domestic data release.
UK Labour Market Data Matches Forecasts
This morning’s UK labour figures delivered few surprises:
- Unemployment edged up to 4.5% in March
- Average earnings growth slowed to 5.5% year-on-year
Despite the softening in wage growth, the figures landed roughly in line with expectations and had little immediate impact on sterling during early trading.
Focus Shifts to US CPI Inflation Figures
Later today, the spotlight moves to the US, with the release of April’s Consumer Price Index (CPI) data.
Markets expect the headline inflation rate to hold steady at 2.4%, with the core rate unchanged at 2.8%.
These figures will be watched closely for clues on the Federal Reserve’s next move – and any deviation from the forecast could spark fresh volatility in dollar pairs.
Manage Currency Risk with Qu Money
With global trade policy shifts and key inflation data shaping the market outlook, now is a critical time to stay informed.
For expert guidance on how today’s developments could affect your currency exposure – or to take advantage of market opportunities – contact a Qu Money specialist today.